Question : When the Company decided to record the issue of Debentures as Collateral Security: Which of the following accounts should be debited?
Option 1: % Debenture account
Option 2: Debentures suspense account
Option 3: Bank loan account
Option 4: No entry required
Correct Answer: Debentures suspense account
Solution : Answer = Debentures suspense account
When a company decides to record the issue of debentures as collateral security, the appropriate account to be debited is the "Debentures Suspense Account." This account is used to temporarily hold the debenture proceeds until the collateral is provided. It ensures accurate recording and tracking of the transaction until it is finalized.
Hence, the correct option is 2.
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